But he says Prime Minister Paul Martin is reneging on his election promise of a better deal.

"Now what Paul Martin has done  he's actually turned his back on the people of Newfoundland and Labrador when they need him most. Today should be a day of joy and jubilation in our province. Unfortunately it is a day of sadness," Williams said.

Martin says he still wants to work things out with Williams. He denies breaking any promises and says the province has been offered an unusually rich deal.

Williams' departure came as Martin and the premiers were preparing to start negotiations on federal equalization payments.

It cast a pall over the meeting, where the premiers had hoped to present a common front in their pleas for more equalization cash.